QuickNews, Wednesday, Nov. 4.
G.O.P. ELECTORAL SURGE A REBUKE TO OBAMA? NOT REALLY.
G.O.P. RECLAIMS GOVERNORS' MANSIONS IN RED VIRGINIA AND BLUE NEW JERSEY.
BUT ULTRA-CONSERVATIVES LOSE KEY NEW YORK CONGRESSIONAL RACE.
FLEETING SETBACK FOR WHITE HOUSE | Reform agenda will be assailed as too radical. But combination of low voter turnout, which always favours G.O.P.; continued strong popularity of Obama in both Virginia and New Jersey according to exit polls; and continued high U.S. public approval of both Obama and health-care reforms in national polling suggest yesterday's results hold less meaning than punditocracy will claim. A truism asserts itself: In rotten economy, no president has coattails. Then again, WH help in closely watched NY 23rd did force defeat of Limbaugh-Palin-Gingrich-backed candidate in solidly red Congressional district bordering Ontario, padding Dem majority in House. Dowd rips "narcissist" Rush.
STRONACH'S DREAM DIES | In reversal, GM will keep Opel-Vauxhall rather than sell to Magna. This was a deal I didn't think would get done, as you know, or was in Magna's best interests. Stronach-led consortium was erstwhile tool-and-die maker's bid to be first auto-parts maker to "graduate" to full-fledged automaker. GM has relied on Opel-engineered platforms for its bestselling Chevrolet Malibu and its Buick LaCrosse, and the forthcoming Chev Cruze compact on which its small-car progress is pinned. Aborted deal is likely a blessing for Stronach, 76, who was thankful to have lost earlier bid for future bankruptcy candidate Chrysler. GM Europe has lost more than $6 billion (U.S.) since 2000, $1.6 billion (U.S.) last year alone. Magna, with no expertise marketing cars, can now focus on cherry-picking rival auto-parts firms driven to the wall in epic global auto downturn. Opel's pro-Magna workers are angry at GM's volte face. So is Berlin, which heavily backed Magna in months'-long negotiations.
BUFFETT'S BIG BET ON RAIL | Pays $26 billion (U.S.) for BNSF, U.S.'s largest railroad. Deal, Buffett's biggest ever, seen as vote of confidence in U.S. economy. It's certainly a vote on coal, of which BNSF is a leading shipper. Which says Warren thinks soaring demand by electric cars for coal-generated power - now accounting for half of U.S. electricity - will trump efforts to displace the prime climate-change culprit with alternative energy sources at least in medium term. Given Herculean task of that conversion, he's probably right. Still, 18% premium for Old Economy firm is, by Buffett's admission, rather exuberant. “I stretched on this one," Buffett said yesterday. “I went to the last nickel.” Recall that a rueful Buffett overpaid for his second-largest acquistion, General Re. NYT panel debates merits of deal here.
Latest addition to Berkshire Hathaway portfolio of 80-odd companies, running the gamut from See's Candies and the Buffalo News to Fruit of the Loom and Benjamin Moore paints, is Burlington Northern Santa Fe, largest of the four railroads that dominate the U.S. industry. Photo by Justin Sullivan, Getty Images.
AUDITOR GENERAL TEARS STRIP OFF HARPER | Ottawa ill-prepared for pandemics and other national emergencies, Sheila Fraser says in latest annual report. But A-G gives passing grades to federal eHealth initiative, which has fallen under suspicion after Ontario eHealth debacle.
OBITUARY | Claude Levi-Strauss, acclaimed anthopologist, dies at 100. His studies of indigenous-people's culture in Western Hemisphere redefined academics' methodology worldwide, and The Naked Man and other seminal books first popularized the study of man's origins and evolution. “People realize he is one of the great intellectual heroes of the 20th century,” Philippe Descola, chairman of anthropology at Collège de France, told NYT on centenary of Levi-Strauss' birth earlier this year, which was celebrated in at least 25 countries.
The young Claude Levi-Strauss during a Brazilian research project. Photo: Apic, Getty Images.
PENDING AUTO BOOM? | Most automakers post U.S. sales gains in October. This despite end of "cash for clunkers" federal rebate scheme in August; a near-12% drop in automaker incentives from September; and 15 million Americans unemployed. Ridiculed in some quarters, Obama's "cash for clunkers" program not only jolted sales over the summer, but has got Americans back into buying mood or at least visiting showrooms. Yet the more robust October sales translate into annualized rate of a mere 10.5 million units, almost half the record level earlier this decade. Which suggests a huge upside potential in sales over next two to three years as pent-up demand grows. October results for all automakers here.
Sergio Marchionne, Toronto-trained accountant who now heads both Fiat SpA and Chrysler, aims to dazzle industry analysts today at Chrysler's Auburn Hills, Mich. headquarters with long-awaited details of Chrysler turnaround plan. But there's no disguising fact that Fiat, which invested $0 to acquire its Chrysler stake and pledges not to inject a single euro in the crippled Chrysler, is using the #3 U.S.-based automaker as a mere sales agent for an ailing Fiat's second crack at the N.A. market for its own line-up, with little interest in (or available cash for) the costly task of rejuvenating Chrysler's models.
GOOD LUCK WITH THAT | Fiat unveils five-year plan for Chrysler in Detroit today. Will replace slow-selling Chrysler models with more fuel-efficient Fiats. Also plans reintroducing Alfa Romeo to N.A. I still think real solution to Chrysler is to shoot it. This deal seems no less looney to me than it did in April (here and here) or May. Chrysler's 2009 volume will be half previous year's. Its market share has dived to 7.9% in October from 11.3% the year previous. In flat October for most makers, Chrysler sales plummeted 30%. As new operator, Fiat vows not to put a dime of its own into Chrysler - just as well, since "saviour" Fiat itself is losing a tonne of money. Crux for Chrysler is stale product line. Only newly engineered cars incorporate latest fuel efficiency and other must-have features - and a new model takes about four years to develop. Under Daimler ownership, Chrysler's engineering and R&D were gutted. When Chrysler next hits the wall, there won't be an encore to Canada/U.S. $12.5-billion (U.S.) bailout. The Fiats that Turin will sell in N.A. will be made in Europe or assembled in Mexico, so there are few American jobs being saved, much less created in this deal. The arrangment basically transforms Chrysler into a glorified distribution arm for Fiat's second effort to crack N.A. with Fiat-badged cars. And Fiat's models today are just as pug-ugly and breakdown-prone as the ones Americans rejected when Fiat was chased out of the N.A. market in the 1980s.
AND WE LOVED HER | Queen Mum loved Canada, author of new official bio says. Love affair began with first Canadian tour by a sitting monarch, King George VI, in 1939. That visit prompted Ontario officials to name country's first controlled-access road for the royal consort - and the Queen Elizabeth Way has been fondly known as the QEW ever since. (An impressive obelisk near foot of Humber River marks QEW's western terminus, and the first of about 15 visits to Toronto by the Queen Mother.) "Canada became her favourite country in the world after Britain," says William Shawcross, author of 1,120-page Queen Elizabeth the Queen Mother: The Official Biography. For me, the Queen Mum is unforgettable for her response when asked if she would be sending her children to safe haven abroad at the dawn of the world war that came just months after she unveiled that obelisk. She said, in effect: I must be wherever the children are, and I cannot leave my husband. And the King is not leaving Great Britain under any circumstances. So we shall all be staying here no matter what comes.
ODD CHOICE FOR OSCAR HOSTS | Steve Martin, 64, and Alec Baldwin, 51, get the nod. Yet Academy has been striving for younger TV audience for annual gala. LA Times speculates deciding factor was both men's starring roles in It's Complicated, in which they're dueling love interests for Meryl Streep. If either is touched by Oscar, it would be the first time since 1987 that an Oscar host has also been a nominee.
YUK | "Metrotextuals" new term for men who sign off text messages with a kiss (x). Practice of "bromantic" affection most prevalent among 18-24 year old males (75% in a T-Mobile survey), though 10% of men over 55 also have become metrotextuals. Strength of sentiment is expressed by multiple and upper-case "x"s. The mate girding to tap you for a quick 70 quid to cover a poker bet is apt to sign off with "XXX." Insurance worker Nick Kirkham, 25, says: "Apart from my boss or a work client, there's no one I wouldn't send a kiss on text to."
CELL USERS HUGELY DISTRACTED | Even a unicycling clown doesn't catch cell users' notice. "That cell phone really disrupts things," says Ira Hyman, psychology prof at Western Washington University, who wanted to chart distraction outside a laboratory setting. A student volunteer dressed in a clown suit unicycled for an hour across the campus's main square. In a report on passerby reaction, to be published in December in Applied Cognitive Psychology but already on the journal's website, only 25% of cellphone users reported noticing the unicycling clown, compared with 71% of cell-less people walking in pairs.
NOW THAT'S A ROOM WITH A VIEW | Space resort hotel on schedule to open in 2012. Galatic Suite Ltd. (www.galacticsuite.com), based in Barcelona, will charge $4.4 million (U.S.) for a three-night stay, including an 8-week training course on a tropical island. Guests will circle the Earth every 80 minutes. Nascent space tourism industry already includes Spaceport America of New Mexico and Richard Branson's space tours firm, Virgin Galactic, which charges a more modest $200,000 (U.S.) for an extra-terrestial ride.
QUOTE OF THE DAY | "I've been married to one Marxist and one fascist, and neither would take the garbage out." -Lee Grant, U.S. actress.
Courtesy The New Yorker, Nov. 2 edition.